HELOC and home equity loan rates Saturday, March 21, 2026: The second mortgage equity solution

Core Insights - Second mortgage products, including HELOCs and home equity loans, are becoming increasingly popular as primary mortgage rates remain above 6% and the prime rate is near a three-year low [1] Group 1: HELOC and Home Equity Loan Rates - The average HELOC rate is currently 7.20%, with a low of 7.19% recorded in mid-January [2] - The national average rate for home equity loans stands at 7.47%, with a low of 7.38% noted in early December [2] - Rates are determined based on a minimum credit score of 780 and a maximum combined loan-to-value ratio (CLTV) of less than 70% [2] Group 2: Market Dynamics - Homeowners with low primary mortgage rates may find it frustrating to access the growing equity in their homes, making second mortgages like HELOCs or home equity loans a viable option [3] - Second mortgage rates are calculated using an index rate plus a margin, typically based on the prime rate, which is currently at 6.75% [4] - Lenders have different pricing methodologies for second mortgage products, making it essential for borrowers to shop around [5] Group 3: Lender Offerings and Comparisons - The best HELOC lenders provide low fees, fixed-rate options, and generous credit lines, allowing homeowners to utilize their equity flexibly [7] - An example of a competitive offering is FourLeaf Credit Union, which currently offers a HELOC APR of 5.99% for the first 12 months on lines up to $500,000 [8] - Home equity loans typically have fixed rates, making them easier to compare since they do not have introductory "teaser" rates [6][9] Group 4: Current Market Conditions - The national average for adjustable-rate HELOCs is 7.20%, while fixed-rate home equity loans average 7.47% [11] - For homeowners with significant equity and low primary mortgage rates, now may be an optimal time to secure a HELOC or home equity loan for various uses, including home improvements [12] - A $50,000 HELOC at a 7.25% interest rate would result in a monthly payment of approximately $302 during the 10-year draw period, but payments may increase during the repayment period [13]